John Peter Amewu – Minister of Lands and Resources Minister
Anglogold Ashanti’s full-year production for 2017 was 3.755 million ounces compared to 3.628 million ounces for 2016.
Notably, the company achieved a stronger performance in the second half of 2017, producing 2.007 million ounces compared to 1.748 million ounces in the first half, an increase of 15 percent.
All-in sustaining costs and capital expenditure for the year remain well within the market guidance provided for 2017.
Headline earnings for the period are expected to be between $16 million and $38 million, with headline earnings per share (“HEPS”) of between 4 cents and 9 cents.
Headline earnings and HEPS for the comparative period were $111 million and 27 cents, respectively.
The basic loss for the period is expected to be between $180 million and $200 million, resulting in a basic loss per share of between 43 cents and 48 cents.
Basic earnings and earnings per share (“EPS”) for the comparative period were $63 million and 15 cents respectively.
The expected overall decreases in headline earnings and basic earnings for the period compared to the comparative period were primarily due to non-cash impairment and de-recognition of certain of the South African assets and goodwill, largely as a result of the restructuring and disposal of the related assets, affecting only basic earnings by an amount of $221 million (post-tax) or 53 cents per share (refer to the explanatory note below); retrenchment costs relating primarily to the restructured South African operations of $71 million (post-tax) or 17 cents per share (cash impact of $49 million); and a once-off non-cash provision in respect of the estimated costs of the settlement of the silicosis class action claims and related expenditure, of $46 million (post-tax) or 11 cents per share.
In the interim results for the half year ended 30 June 2017, the company reported impairments relating to the restructuring of certain of its South African business units of $86 million (post-tax).
Subsequently, on 19 October 2017, the company announced the sale of various assets in the Vaal River region, including the Moab Khotsong Mine, to Harmony Gold Mining Company Limited for a cash consideration of $300 million.
As a result of the conclusion of the sale agreements, the company reclassified the carrying values of the sale interests in the company’s financial statements to assets held for sale in accordance with IFRS 5 – Non-current Assets Held for Sale and Discontinued Operations.
Consequently, the carrying values of the sale interests were impaired to the fair value of the sale consideration at the end of December 2017, which resulted in an impairment charge of $110 million (net of deferred tax) or 26 cents per share.
A business desk report